The impact of the judgment is a $13.7 million recovery of income tax and related interest expense paid to CRA in 2006. In addition, Alberta Power will receive interest income of approximately $3.1 million earned on such amounts paid to CRA. These adjustments will result in a $16.8 million increase in earnings. CRA will be required to refund to Alberta Power approximately $28.0 million including interest and net of consequential adjustments to other taxation years arising from the judgment.

The reassessment treated the proceeds received from the sale of the H.R. Milner generating plant to the Alberta Balancing Pool as income rather than as a sale of an asset. Alberta Power successfully argued that its treatment of the proceeds as a capital receipt was correct.

Alberta-based Canadian Utilities Limited, with more than 7,700 employees and assets of approximately $9.0 billion, delivers service excellence and innovative business solutions worldwide with leading companies engaged in Utilities (pipelines, natural gas and electricity transmission and distribution), Energy (power generation and midstream services), Structures & Logistics (manufacturing, logistics and noise abatement) and Technologies (business systems solutions). More information can be found at www.canadian-utilities.com.

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